Explosive e-commerce and supply chain growth in Malaysia has recaptured the attention of logistics specialist UPS

A UPS (United Parcel Service) truck sits on a street in Washington, DC. (Photo by EVA HAMBACH / AFP)

UPS extends footprint in Malaysia on back of e-commerce, logistics boom

Global shipping and supply chain management firm United Parcel Service (UPS) is set to extend its retail presence in Malaysia this year with a new partnership with ParcelHub, to capitalize on the region’s surging e-commerce and logistics demands.

UPS already has an existing partnership in Malaysia with third-party fulfillment services provider Mail Boxes Etc (MBE), which has over 90 outlets in the country. But the sharp rise in not only online shopping behavior, but also in last-mile parcel delivery and logistics management, has seen the American firm raise its fulfillment profile locally with a move to leverage ParcelHub’s 200 outlets nationwide.

A survey on COVID-19 found that 57% of Malaysians have been purchasing goods and services online in droves, far more than they ever did prior to the pandemic. This new behavior is not expected to abate even in the future, as the contactless benefits and convenience of e-commerce will likely become a mainstay of consumer shopping attitudes from this point on – contributing towards a local e-commerce boom.

UPS President for South Asia Matt Parkey believes that the robust e-commerce growth coupled with the shifting supply chains in and around Malaysia, will favor logistics specialist UPS in the long run. “Notwithstanding the near-term impact of the Covid-19 pandemic resurgence, Malaysia has strong long-term growth fundamentals, and these fundamentals bode well for many small and medium enterprises (SMEs) that support industries along the value chain,” Parkey told local news agency Bernama.

He also pointed out that SMEs are the cornerstone of the local economy, making up 98.5% of businesses in Malaysia. “UPS’s focus right now is on improving the resiliency of SMEs and their access to global markets.

“The pandemic has exposed vulnerabilities in supply chains and SMEs have been one of the worst-hit. Throughout the past year, we helped many traditional businesses pivot online to reach new audiences amid tightening domestic demand and physical store closures,” Parkey said.

Seizing new opportunities in this changing landscape will be key to SME survival, and these include digitized solutions that can help accelerate growth, or help a small business pivot towards a different, lucrative vertical.

“On our part, we have implemented customized solutions for businesses of any size,” Partkey commented. “For example, to boost Malaysia’s electronics manufacturing, we’ve developed capabilities to move expensive semiconductor shipments halfway around the world with almost zero sorting to move quickly and eliminate any damages.”

The UPS President for South Asia went on to highlight how Malaysia had been making in-roads to boost its value-added manufacturing capabilities, to capitalize on changing supply chain needs in the country. Parkey noted how electrical and electronics products remained the country’s top export earner last year, this includes investments from over 50 semiconductor companies including Intel and AMD.

And despite the global semiconductor shortage, US semiconductor processing equipment designer Lam Research recently added manufacturing hub Penang to its list of global production locations, which include the US, South Korea and Austria.